Biden Administration Establishes AI Safety Institute; Nokia Sues Amazon and HP for Patent Infringement; and Appeals Court Revives Fortnite Dance Copyright Case

This week in Other Barks & Bites: Nokia files patent infringement lawsuit against Amazon and HP in multiple jurisdictions; a UK software company begins a “David and Goliath” trademark battle with Meta; and the Biden Administration announces the establishment of the new AI Safety Institute, and the U.S. Court of Appeals for the Federal Circuit issues a split precedential ruling on attorneys’ fees in favor of Amazon.

Bites

CAFC Issues Fractured Precedential Decision on Attorneys’ Fees

The U.S. Court of Appeals for the Federal Circuit (CAFC) on Friday, November 3, issued a precedential ruling affirming a district court award of $5.2 million in attorneys’ fees against PersonalWeb Technologies. PersonalWeb argued the district court erred in finding the case exceptional and also in calculating the fee award, but the CAFC said “PersonalWeb wove the very net in which it now stands,” explaining that PersonalWeb broadly dismissed all claims against Amazon instead of reserving its right to litigate some claims, and then later sued Amazon’s customers. “As the Supreme Court has reasoned, PersonalWeb was ‘bound’ by its ‘final judgment’ that PersonalWeb stipulated to, and it is a ‘rule of fundamental and substantial justice’ for courts to recognize and enforce those established rights,” said the CAFC.

Judge Dyk dissented, noting that the U.S. Solicitor General had agreed with PersonalWeb in its appeal to the Supreme Court of the CAFC’s June 2020 decision finding that PersonalWeb was barred in part by the 1907 Supreme Court ruling, Kessler v. Eldred, which said that a losing patent holder cannot later assert the same patents against the winning party’s customers. “The majority’s opinion rests on the remarkable proposition that PersonalWeb’s arguments were objectively
baseless (and supported a fee award) despite the Solicitor General’s agreeing that those very same arguments were correct,” wrote Dyk.

Nippon Steel Drops Patent Infringement Lawsuits Against Toyota in Favor of Partnership

On Thursday, November 2, Nippon Steel announced that it dropped multiple patent infringement lawsuits against Toyota and two steel companies that alleged those companies infringed on patents related to electrical steel sheets. Instead of pursuing legal action, the Japanese firm stated that it would be working in closer collaboration with these companies in the automotive and decarbonization fields. Details of the agreements between the companies were not released. Nippon Steel said it “will also continue to firmly protect its intellectual property rights as the fruits of its technological development.”

Appeals Court Revives Copyright Infringement Case Against Fortnite Creator

On Wednesday, November 1, the U.S. Court of Appeals for the Ninth Circuit ruled that Epic Games, the creator of Fortnite, must face a copyright infringement lawsuit filed by choreographer Kyle Hanagami, who accused the company of using copyright-protected dances in its game. The ruling overturned a district court decision that dismissed the case. The circuit court found that the lower court incorrectly determined that the choreographer’s dance was not eligible for copyright. “We conclude the district court erred in its application of the substantial similarity test, as Hanagami plausibly alleged that his choreography and Epic’s emote share substantial similarities,” wrote the appeals court.

Biden Administration Announces New AI Safety Institute

On Wednesday, November 1, the Biden Administration announced the U.S. Commerce Department will establish the U.S. Artificial Intelligence Safety Institute (USAISI) to lead the government’s efforts to evaluate advanced AI models for safety. The new institute will be part of the National Institute of Standards and Technology (NIST) and will evaluate emerging AI risks. “Through the establishment of the U.S. AI Safety Institute, we at the Department of Commerce will build on NIST’s long history of developing standards to inform domestic and international technological progress for the common good,” said Commerce Secretary Gina Raimondo. The announcement was made to coincide with Vice President Kamala Harris and Secretary Raimondo’s participation in the AI Safety Summit in the UK.

Nokia Files Patent Infringement Lawsuit Against Amazon and HP in Multiple Jurisdictions

On Tuesday, October 31, Nokia filed lawsuits in the US, Germany, India, the UK, and the European Unified Patent Court against Amazon and HP accusing the companies of infringing on multiple Nokia video streaming patents. Nokia said that the patents cover a variety of technologies related to video streaming including video compression, content delivery, content recommendation, and hardware. The Finnish company accused the two companies of using the patented technology without a license and hoped the lawsuit would result in the companies negotiating a licensing agreement. “We’ve been in discussions with each of Amazon and HP for a number of years, but sometimes litigation is the only way to respond to companies who choose not to play by the rules followed and respected by others,” said Nokia in a statement.

UK Company Launches “David and Goliath trademark battle against Meta

On Monday, October 30, a UK software company sent a cease-and-desist letter to Meta’s Instagram giving the company 30 days to stop using the name Threads for their new feature in the UK. The British company Threads Software Limited also said that Meta had offered to purchase the company’s domain name ‘threads.app’ four times. “We recognise that this is a classic ‘David and Goliath’ battle with Meta,” said Dr. John Yardley, Managing Director of Threads Software, and whilst they may think they can use whatever name they want, that does not give them the right to use the Threads brand name.”

Barks

USPTO Updates Fee Schedule for Patent Cooperation Treaty Fees

On Wednesday, November 1, the U.S. Patent and Trademark Office (USPTO) updated the fee schedule for Patent Cooperation Treaty (PCT) fees. The changes include increases to four international filing fees and two handling fees.

UK Publishers Groups Release Statement Ahead of Global AI Safety Summit

On Tuesday, October 31, four UK publishing trade associations released a joint statement urging the UK government to stop AI systems from using copyrighted works with impunity. The statement was released ahead of the inaugural AI Safety Summit, a global meeting held in London from November 1-2. The trade associations clarified that they were early adopters of AI technology and believe it can be a useful tool. The groups wrote, “however, it [AI] must be used ethically and legally, and its use must be regulated.”

CAFC Denies Meta’s Petition to Move Patent Infringement Case to California

On Monday, October 30, the U.S. Court of Appeals for the Federal Circuit (CAFC) denied Meta’s motion to transfer the patent infringement case against it from Texas to California. Immersion Corporation filed the lawsuit in a Waco, Texas court alleging that Meta has infringed on 6 of its patents. Meta attempted to argue that a California court would be more appropriate for employees with knowledge of products relevant to the case. However, the CAFC agreed with a district court ruling that found Meta failed to show the California court was clearly more convenient.

This Week on Wall Street

FTX Founder Sam Bankman-Fried Found Guilty of All Seven Fraud Counts

On Thursday, November 2, a New York jury found Sam Bankman-Fried, founder of cryptocurrency platform FTX, guilty of all seven criminal fraud counts that he faced. The charges carry a maximum prison sentence of 115 years. “Sam Bankman-Fried perpetrated one of the biggest financial frauds in American history – a multibillion-dollar scheme designed to make him the King of Crypto,” said Damian Williams, U.S. attorney for the Southern District of New York. Bankman-Fried used some of his massive cryptocurrency wealth to influence politics and cryptocurrency regulation.

Federal Reserve Leaves Interest Rates Untouched

On Wednesday, November 1, the Federal Reserve maintained the federal interest rate at 5-1/4 to 5-1/2 percent, the highest rate since 2001. In its statement, the committee reiterated the justification for its high interest rates as its goal is to reduce inflation to 2 percent and achieve maximum employment. “The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals,” the Federal Reserve wrote in its statement.

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2022 are announcing quarterly earnings next week (2022 rank in parentheses):

• Monday: NXP Semiconductors (91)
• Tuesday: Toyota (4), Uber (214)
• Wednesday: Honda (25), Corteva (133), Walt Disney Company (244)
• Thursday: Sony (11), Becton, Dickinson and Company (137)
• Friday: None